Asian freight rates grew by 53% amid Red Sea crisis

Posted on January 2, 2024   |  

Freight rates from Asia have surged by 53% in just one month, affected by the chosen route and disruptions caused by major players like container shipping giants and British Petroleum suspending transit through the Red Sea-Suez Canal route following recent attacks.

The disruption holds significance as the Bab-el-Mandeb Strait, a vital link connecting the Mediterranean Sea to the Arabian Sea through the Red Sea and the Suez Canal, plays a crucial role in 30% of global container traffic. India, especially, relies on this route for trade with West Asia, Africa, and Europe.

In response to the attacks, some insurers have introduced a $5,200 war risk surcharge on top of regular freight charges, signaling increased challenges and costs for shipping through the affected region.